Rep. John Shadegg (R., Ariz.) is hopping mad over a Wall Street Journal story from last week on the role of political influence in determining where the bank bailout money is going. Institutions in his state have received nothing, but powerful Democrats on the House Financial Services Committee–Maxine Waters (D., Calif.) and Barney Frank (D., Mass.)–apparently helped steer $12 million to a Boston-bank that to which both are connected.

“What this article shows,” Shadegg tells The Corner, “is that we are not operating on either appropriate legislative criteria or merit or even a rational allocation of resources based on guidelines given in the legislation . . . This article suggests that perhaps one of the reasons TARP hasn’t accomplished anything is that the money is being allocated based on political power. The well-connected get what they want.”

In theory, TARP money was supposed to go to sound financial institutions so that it would be easier for them to begin lending money again. But Frank takes credit for inserting into TARP a special provision with crtieria so narrow that it would benefit OneUnited, which the Journal notes would not have otherwise received money because of its poor condition. The bank, the article states, “was under attack from its regulators for allegations of poor lending practices and executive-pay abuses, including owning a Porsche for its executives’ use.”

Waters’s husband, who served on the bank’s board until last spring, owned two assets related to the bank. They are listed in her most recent congressional financial disclosure forms, which describe her and her spouse’s assets in calendar year 2007. The two assets, whose precise nature is not clearly labeled, were valued at $250,000 to $500,000 each. One of them earned interest in calendar 2007, and the other paid a dividend. Waters’s office did not respond to inquiries earlier today.

OneUnited was in dire financial straits late last year, having seen its Tier 1 Capital (a technical term for a bank’s rainy day money) severely depleted because it was heavy on Fannie Mae stock. Until last year, Waters’s husband served on the board of OneUnited, which bills itself as the first black-owned Internet bank in the United States.

When the federal government took over Fannie Mae and Freddie Mac, the Journal reported last week, OneUnited’s attorney, Robert Cooper, called Frank and Waters “to complain that the Treasury’s move had hurt the bank.” Waters told the Journal she was unaware that OneUnited had received TARP money, and that “OneUnited was ‘just a small’ bank.”